These days, Baba Ramdev’s Patanjali units are often frequented by several investors and analysts to get some insights into how Patanjali works.

These days, Baba Ramdev’s Patanjali units are often frequented by several investors and analysts to get some insights into how Patanjali works.

ET Intelligence Group: These days, Baba Ramdev’s Patanjali units are often frequented by several investors and analysts, but they are there not to pick Baba’s brains on yoga, but to get some insights into how Patanjali works, and how it has disrupted the business strategies of many bigger FMCG firms.

“We see many visitors from the research and investment community regularly these days. They are constantly in touch with us to know our progress,” said SK Tijarawala, general secretary, Patanjali Ayurved.

Given the uncertainty over economic growth and the state of the markets, investors are going for defensive sectors such as FMCG that offer higher growth visibility. But there’s one thing that’s bothering them, the impact of Patanjali’s disruptive strategy, especially the low pricing for quality products.

It has already begun to reflect on the numbers of some companies, the most obvious being Colgate-Palmolive, largest oral care company, with around 57% market share. After logging double digit growth from FY05-FY15, its sales growth dropped to a mere 3.7% in the first nine months of FY16. Its FY15 sales growth too had dipped to 11.8%, the lowest in the past 10 years. According to a recent report by India Infoline, at least 13 listed companies will be hit by Patanjali.

“Colgate and Dabur would be affected the most whereas ITC and Godrej Consumer would be least impacted,” said Percy Panthaki of IIFL.

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